Promise to sell

The signing of the promise of sale can be done in front of a notary, or between individuals. A promise to sell strongly engages both parties, it is a complex contract that must be drafted with great care.

The promise of sale between individuals (act under private seeing)

The “unilateral promise to sell” is used to implement a sale agreement between a seller and a buyer. Signed just after the negotiation, it is worth agreeing on price and the thing, but not only: it also allows to define all the details of the sale. Property prices, ancillary costs, deadlines, suspensive clauses, capital compensation, legal mentions… This is an extremely important contract.

The promise of sale between individuals is written and signed by them, without the intervention of a notary at the drafting of the contract. This act must respect a number of mentions and clauses, and it is possible, and recommended, to use a real estate agent: accustomed to this type of contract, it proposes its model and guarantees its legal validity.

Even if the promise of sale is signed between individuals, it must still be registered with the tax authorities, according to Article 1840 A of the General Tax Code, the signatories have 10 days to register the deed of promise of sale. This period is counted from the receipt of the deed by the recipient (in hand or by registered mail with acknowledgement).

If the promise to sell is still not registered after 10 days, it is considered null and void.

The registration fee for the deed is set at 125 euros (forfeited).

Content of a promise to sell between individuals

The essential elements of a promise to sell are:

• Party designation: the promising (or seller) and the beneficiary (or future purchaser)
• Designation of the property: the description must be exhaustive.   it includes habitable parts, land, annexes, common areas, land references, etc.
• Legal
• Housing situation: easements, mortgage, rental situation…
• Option lift deadline: It is set freely by both parties.
• Price of the property: it must be paid on the day of the signing of the deed of sale.
• Capital allowance: it is set freely by both parties.
• Ancillary fees: transfer fees (or notary fees), agency fees if applicable…
• Financing plan: the terms of the loan that the seller will apply for.
• Suspended conditions
• Right of withdrawal: mandatory, it lasts 10 days.
• Appendixes: The seller must add a technical diagnostics file and documents relating to the condominium.

Not to forget anything, we use a standard model of promise of sale, but we must be very careful about its content, and the drafting of this type of contract by individuals is not always the best way to protect the interests of both parties, some clauses need to be drafted with vigilance and care:

The capital allowance is often the crucial point of negotiations between the seller and the buyer. This is a sum paid by the beneficiary (buyer) to the promise (seller) at the time of signing (or a few days after, at the end of the withdrawal period). It will be retained by the seller in cases where the purchaser refuses to lift his option to purchase. It is very important: it guarantees the seriousness of the future buyer and compensates the damage suffered by the seller in the event of cancellation of the sale.

Its amount is setfreely, however capped at 10% of the price of the property. It is essential to negotiate this compensation at a sufficiently dissuasive amount to ensure that the purchaser is genuinely interested in the purchase.

The suspensive clauses

In the event of non-achievement, the sale will be cancelled, they protect the buyer and prevent him from getting stuck with a property that he can no longer buy. The most important are the obtaining of a bank loan to finance the acquisition, the realization of a preliminary sale without which the purchaser cannot buy, the possible right of pre-emption of the commune, and many others that only a real estate professional will know how to mention.

The annexes to the promise of sale

It is up to the owner to ensure that no evidence is missing from the file, which could put the validity of the contract in question.

Any promise of sale must be accompanied by a record of technical diagnoses. It brings together all the mandatory diagnoses: the complete list depends on the age of the property, its nature and its geographical location.

Similarly, the Alur Act imposes a list of co-ownership documents to be given to the purchaser, at the time of signing the promise, without which the withdrawal period cannot begin to run.

Retraction time

Signing a promise to sell is a commitment not to be taken lightly! This pre-contract is almost tantamount to signing a deed of sale, as it comes with a capital allowance. Amounting to between 5% and 10% of the sale price, it is paid to the seller at the time of signing. The latter will be entitled to keep it if the purchaser does not wish to raise his option to purchase!

In the case of the sale of accommodation between individuals, the law provides for a mandatory and incompressible withdrawal period for the benefit of purchasers only, which applies to all pre-contracts without exception, compromise or promise of sale!

If the purchaser exercises his right of withdrawal under the conditions provided for this purpose, he is not liable for any compensation, the capital compensation is cancelled, and must be returned to him in full within 21 days.

Since the Macron act of 2015, the withdrawal period is 10 DAYS INCOMPRESSIBLES from the day after receiving the contract signed and completed (with its annexes) by both parties. Sundays and public holidays are included in the count. On the other hand, if the last day falls on an unworked day, the withdrawal period is extended until the next working day, in order to allow the purchaser to access the mail services

The retraction letter model of a promise to sell

To practice it, simply send a recommended letter with notice of receipt to the seller of the accommodation. The shipment must be made no later than 10 days, with the stamp of the post valid.

The letter should simply explain that the recipient of the promise to sell waive the pre-contract under the terms of the law, as in the letter-retraction model of a promise to sell below:

Subject: Retraction on a Promise to Sell

On 2024, we signed a promise to sell the accommodation located at the [address] address. I received a copy of the promise to sell on 2024.

I regret to inform you here and about my decision not to proceed with this proposed purchase.

As provided for by Sections L 271-1 and L 272-2 of the Building and Housing Code, this retraction occurs within 10 days of receipt of the recommended letter of promise of sale.

Therefore, please reimburse me for the amount of [] euros that I gave you by cheque No. [ ] when signing this pre-contract.

Please accept, sir, ma’am, the expression of my distinguished feelings. »

Promise to sell in front of notary (authentic act):

If many individuals choose to sign their promise to sell in front of a notary, it is because it is a pre-contract that is both complex and extremely important.  Property prices, ancillary costs, deadlines, capital compensation, suspensive clauses… Once both parties sign the promise, all details of the sale are already known. 

All promises of sale (including under private seing) must be registered with the tax office within 10 days. This obligation is a distinction between promise and sales compromise: leaving less room for vagaries, the latter is a more closed contract. It does not require tax registration.  In the absence of registration within this time frame, the promise of sale is considered null and void, according to section 1589-2 of the Civil Code.

The notary is a legal specialist who represents the state. Under his status as a public officer, he has prerogatives of public power. It has the power to sign authentic deeds that have absolute legal proof.

The notary can therefore, if you wish, write the promise of sale and have it signed by both parties. This has many advantages, both for the seller and for the buyer. Indeed, his legal and real estate experience will ensure the transaction by being vigilant on the following points, sometimes sources of dispute:

The notary helps you avoid unpleasant surprises  and ensures that the IMMOBILE INDEMNITE  is set at a high enough amount to protect the seller’s interests. He will then receive the allowance on your behalf, upon payment, and place it in a receiver account until the signing of the deed sale. He will ensure that, if necessary, this compensation is paid to the seller if the buyer does not raise his option to purchase.

Similarly, many cases of a promise to sell are plagued by disputes between the two parties, especially if the “beneficiary” (the buyer) refuses to honour his commitments. To avoid tension between individuals, the notary plays a fundamental arbitration role.  By communicating with both parties and ensuring compliance with the law and the contract, it helps to find common ground and get out of the dispute.

The drafting  of the promise of sale is billed freely. Notaries charge variable rates, which can reach several hundred euros depending on the case, usually at the expense of the purchaser. In the event of a legal retraction (within 10 days of signing), the sums invested must be returned to the court within 21 days.

In general, it is the seller who chooses his notary.  The purchaser may also want to involve a notary of his choice, he has the right of course. It is possible to have the deeds received by the two notaries at the same time. The two studies work together, and the acquisition costs will be the same for the purchaser, but divided between the two studies.

To sign a promise to sell to a notary,thecriteria of trust and availability are fundamental. The first contact and the human factor will be very important in your choice. The rates charged are much the same from one study to another. 

It is not obligatory to choose geographically its notary, Notaries can act throughout France  (with the exception of Alsace and Moselle representing exceptions: the real estate law is different, it is indispensable.

The signing of the promise of sale to a notary is carried out in the presence of the entire parties. If a part of the parties is unavailable on that day, it is possible to use a power of attorney to be represented: one can therefore mandate a relative to sign in his place, or even one of the clerks of the study (relationship of total trust required).

On the day of the signing, the notary reads the promise of sale before both parties. The documents are then signed on each page. The promise of sale is a strong commitment, with no possible retraction for the seller: it is better to think carefully before signing.